1031 from 3 unit into 16

[Jamie Rose]

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $1,150,000

Partnered up on a 1031 into a mid size commercial MF in Anchorage (16 units) - no further cash required due to 1031.
We've invested in renovating older 1970's era apartments to grab better tenants - and better rents. This should be a great long term asset for us, already on a good footing.

What made you interested in investing in this type of deal?

Wanting to grow in scale - and I saw the opportunity to trade a hot asset - residential mf - for an under appreciated one - commercial mf -

How did you find this deal and how did you negotiate it?

This was found on the MLS - by knowing our market in great detail - I could tell this was an opportunity hidden in plain sight. We timed the market well also - I could see commercial prices still undervalued - and we picked this up at a 20% discount on today's prices - so over $200k in very quick equity gain.

How did you finance this deal?

Local credit union financing - we got a 15yr fixed rate loan on a 20yr amortization -
We also timed debt markets well - sometimes the stars align

How did you add value to the deal?

Understanding the market - bought it under valued - came in with additional capital to improve units that desperately needed updating. Improved management - and technology - it's a story still being written.

What was the outcome?

We've got something where we're in a great position - to see long term appreciation on the asset - and cash flow throughout the term - it's a win already - but really something I think in 10 years we look back and are amazed at.

Lessons learned? Challenges?

Biggest lesson - where others see problems - look for opportunity.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Yes!
Agent - Jamie Rose
Property Manager - Overwatch @Chris Smock
Lender - MVFCU